Examine the impact of globalisation on operations use a case study
To successfully manage the operations function of a business, managers must change and
adapt due to a range of external influences. Globalisation is an external influence that has a
positive and negative impact on operations, this can be seen in Australia’s largest airline,
Qantas. Globalisation aims to meet the needs of global consumers and to create a global
web. Globalisation causes the removal of barriers of trade between nations, meaning
people, goods, money and ideas can move around the world faster and cheaper than ever
before.
Globalisation allows for the integration of a range of suppliers which creates a global network
or web. Globalisation has enabled Qantas to locate their operation processes within close
proximity with its suppliers to minimise costs. Through the removal of barriers between
nations Qantas is able to take advantage of offshore outsourcing. Qantas has outsourced
operational functions like maintenance to countries with lower operational costs such as
Hong Kong and Malaysia. In addition Qantas outsources some of its pilots from New
Zealand and some of its cabin staff from Asia that work at a lower wage compared to
Australia. Finally, Qantas outsources the IT support services staff for Jetstar in fact the entire
call centre operations is based in the Philippines. Globalisation has made it possible for
Qantas to take advantage of outsourcing and through this strategy has cut costs throughout
the operation function.
Globalisation has allowed Qantas to access new markets overseas and increase their
market share. Expansion into to new and emerging overseas markets is essential for Qantas
to achieve maximum growth potential. Qantas set up a low cost airlines in Asia under the
Jetstar brand to take advantage of growth in that region. In addition Globalisation has made
it easier for Qantas to achieve economies of scale resulting in cost savings through, for
example bulk buying leading to an increase in revenue. These are all the positive impacts
globalisation has on operations.
However globalisation also has a negative impact on operation management. As evident in
Qantas, globalisation has caused over 5000 employees to lose their jobs. The outsourcing of